Price Transparency

How a health system goes above and beyond in its price transparency efforts

Corewell Health seeks not only to comply with price transparency rules but also to ensure patients are thoroughly informed about their financial obligations.

April 22, 2024 12:27 pm

By maintaining a patient-centric perspective, hospitals and health systems can find opportunities to look beyond regulatory requirements and incorporate top-class price transparency models, according to a recent online discussion.

“We want to, first and foremost, empower and equip our customers to make informed decisions about their healthcare services and really shop for the best value,” said Amy Assenmacher, MBA, senior vice president for revenue cycle with Corewell Health. “We often [say] we have an obligation to support our patients in understanding their financing just as our nurses, providers and other clinicians will prepare the patient clinically with what to expect.”

Leaders with Corewell Health, the Michigan-based health system formed from the merger of Spectrum Health and Beaumont Health, gave insights on transparency challenges and best practices during a conversation with Joseph J. Fifer, HFMA past president and CEO, at this month’s online National Health Care Transparency and No Surprises Act Summit.

A daunting task

Hospital and health system leaders have long understood a point that some observers may not realize: The quest for price transparency does not engender simple solutions.

“The theory is simple: Let’s just make it like retail,” Fifer said. “Make it like Amazon, make it like Travelocity. But in practice, there’s way more to it.”

The challenge of making healthcare prices more transparent arguably led to widespread inaction over the years, which in turn created a void that CMS sought to fill with its 2021 regulations.

“There are health systems that do value price transparency,” Fifer said. “Is it throughout the industry? Unfortunately, no, hence we get legislation and regulations. But while well-intended, the solutions miss the mark.”

One source of difficulty at the outset of the recent regulations was the timing amid the COVID-19 pandemic, Assenmacher noted.

“We experienced significant administrative costs of implementing that rule,” she said. “We had to create and post machine-readable files, which required a significant time commitment from a combination of departments to produce that necessary format, extensive investment in our digital-services resources, and ongoing updates to the files to accurately reflect the material changes to our coding and pricing or negotiated rates throughout the year.”

Details to consider

Corewell Health’s transparency tool is embedded in its electronic health record, allowing for the inclusion of data from the chargemaster, payer contracts and claims history. The organization also strives to make the estimate as comprehensive as possible by including all providers involved in the care episode. To that end, Corewell Health partners with its affiliated physicians to load their fee schedules into the tool.

To make optimal use of the resource, however, patients typically must know the CPT codes and the full array of tests and procedures that may be performed, Assenmacher noted.

That may help explain why relatively few patients use the tool. Corewell Health sees about 5,000 self-created estimates per quarter across its system, Assenmacher said.

Patient education and counseling thus constitute a major component of a successful price transparency initiative. For many services, Corewell Health financial counselors proactively conduct price estimates and reach out to patients with the information ahead of a scheduled encounter.

After patients use the estimator tool, a survey is deployed to assess their experience. Data suggest shoppable services such as imaging and surgeries are the procedures that most frequently draw interest.

For the machine-readable file, Corewell Health employs a reputable vendor to annually conduct a pricing defensibility analysis.

Two sets of rules

Corewell Health has had exposure to the regulations that have been implemented in recent years for health plans as well as for hospitals. The organization operates the Priority Health insurance plan, which has the second largest membership in Michigan.

The organization launched its initial health plan transparency tool in 2015, seven years before the new regulations took effect. Tool inputs include the provider, location of care, the member’s deductible and out-of-pocket maximum, and copay or coinsurance. Data is derived from the insurer’s network, benefit design and claims history, and information is available on provider ratings, reviews, outcomes and patient satisfaction scores.

Priority Health seeks to direct its members to lower-cost providers when appropriate by deploying Visa gift cards as incentives. The health plan has saved $20.5 million in healthcare costs during the five years since the gift-card initiative launched, Assenmacher said.

“When you use the cost estimator tool, you get rewarded for being a smart shopper,” Assenmacher said. “It’s a pretty cool program to really incentivize our patients to be part of that informed decision-making and choosing that lower cost of care for them.”

A long-running effort

Fifer noted he’s advocated for price transparency since the mid-2000s, when he headed up finance operations at Spectrum Health. The organization began posting charges and payments for inpatient and outpatient services long before any regulations were drafted and any of today’s technology was available.

As HFMA’s leader from 2012 to 2023, Fifer sparked efforts to provide transparency guidance and tools to members and the industry at large. Such resources have been valuable in Corewell Health’s efforts to optimize its transparency initiatives, said Matthew Cox, CHFP, CPA, the health system’s executive vice president and CFO and a member of HFMA’s Board of Directors.

“I personally believe there’s nothing worse than having an amazing [clinical] outcome,” Cox said, “and then having patients be shocked because they did their homework, they go to a hospital, and the price is significantly different than they thought it was going to be.

“It’s still expensive. People are not going to say, ‘Wow, what a cheap place to get your healthcare done.’ But it shouldn’t be a surprise.”


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